Building Businesses for Adventure With Derek Kalles

by | Podcast

Derek Kalles is the Founder and CEO of Kalles Group, a Seattle-based consulting firm specializing in cybersecurity and engineering solutions for organizations navigating today’s rapidly evolving digital landscape. Under his leadership, Kalles Group has built a reputation for human-centric security practices and boasts an impressive client roster. In addition to his main venture, Derek is a serial entrepreneur with multiple businesses across property management and AI-driven sales, and has shared valuable lessons from both successes and pivots.

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Here’s a Glimpse of What You’ll Hear:

  • [02:15] Derek Kalles shares how his childhood curiosity sparked entrepreneurial ambition early
  • [09:47] Balancing two companies during tough transitions
  • [13:38] How AI is transforming cybersecurity and business risk today 
  • [21:01] Why business pivots can lead to unexpected growth and wisdom
  • [27:26] Derek’s hacks for juggling four companies and family life
  • [30:16] How living in Spain changed Derek’s leadership and priorities

In this episode…

Some entrepreneurs build companies to chase growth, while others build them to create a life big enough for the people and adventures that matter most. What does it take to design businesses that can keep moving forward, even when the founder is halfway across the world?

For Derek Kalles, a lifelong builder and multi-business entrepreneur, the answer is people, systems, and the willingness to let go of being the hero. He explains that working with great people makes it possible to operationalize and sustain multiple ventures, whether it’s cybersecurity consulting, property management, finance, or AI. That mindset has allowed him to keep building while also creating room for family, travel, and a leadership style that empowers others to step up.

Tune in to this episode of the Smart Business Revolution Podcast as John Corcoran interviews Derek Kalles, CEO of Kalles Group, about building businesses for adventure. Derek talks about launching multiple ventures, navigating AI and cybersecurity risks, and living in Spain with his family. Derek also shares advice on balancing founder instincts with leadership-led growth.

Resources mentioned in this episode:

Special Mention(s):

Quotable Moments:

  • “The journey is never linear. It’s never, you know, X marks the spot.”
  • “You get one chance at this rodeo, like work with interesting people.”
  • “They (AI) are designed to empower that end user, you know, whether or not you want to or not.”
  • “So for us, it’s trying to stay focused on how cyber security and how security shows up in AI.”
  • “It challenged me as a leader to look at my leadership team and be more leadership led, not founder led”

Action Steps:

  1. Build with people you trust: Surrounding yourself with capable, values-aligned leaders makes it possible to sustain multiple businesses without carrying everything alone.
  2. Create systems that support freedom: Strong processes and operational structure allow businesses to keep moving forward while giving founders more room for family, travel, and new opportunities.
  3. Stay curious through every pivot: Treating business challenges as learning opportunities helps entrepreneurs adapt when the market, product, or customer need changes.
  4. Balance innovation with security: Embracing tools like AI while managing risk helps companies move faster without exposing themselves to unnecessary vulnerabilities.
  5. Let go of the hero mindset: Empowering others to lead creates stronger teams, healthier businesses, and more space for long-term growth.

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Episode Transcript

John Corcoran: 00:00

All right. Today we’re going to talk about how to build multiple businesses and actually build businesses that enable you to go have adventures in your personal life, like go live abroad with your family. My guest today did that. His name is Derek Kalles. I’ll tell you more about him in a second, so stay tuned.

Intro: 00:18

Welcome to the Smart Business Revolution Podcast, where we feature top entrepreneurs, business leaders, and thought leaders and ask them how they built key relationships to get where they are today. Now let’s get started with the show.

John Corcoran: 00:35

All right. Welcome, everyone. John Corcoran here. I’m the host of this show. And you know, if you’ve listened before that every week we have smart CEOs, founders and entrepreneurs from all kinds of companies. And if you check out the archives, we’ve got Netflix and Grubhub, Redfin, Gusto, Kinkos. Lots of great episodes for you to check out.

And of course, this episode brought to you by our company Rise 25,where we help businesses to give to and deliver, build great relationships with people that matter to them. And how do we do that? We do that by helping you to launch and run a podcast that allows you to build relationships with people you respect and admire. So if you want to learn more about that, go to our website, rise 5.com, or you can email our team at support@rise25.com.

All right. My guest here today is someone I’ve been trying to book for over a year now. He’s the founder and CEO of Kalles Group, a Seattle based cybersecurity and technology consulting firm. He’s got so many businesses that I keep discovering new ones. It’s like, turning around the corner is another business there. But he started his career as a technology consultant at Accenture, and he’s worked with a number of different major enterprises. And he’s got a number of different businesses, one in the property management space. He’s got an AI sales space business. His main one is in cybersecurity. 

So we’re going to talk about AI and how cybersecurity is being affected by that. And of course, as I teased in the beginning, the interesting thing is he got up and took his family and went and lived halfway across the globe in Europe for a period of time, which I think is so cool that he did that. So Derek, I’m so excited to have you here today. You seem like an entrepreneurial guy. You seem like a paper route kind of guy. 

 A lemonade kind of guy. You said you were drawing up ideas for storage businesses when you were younger, which I don’t know who does that, but what was young Derek like as a kid?

Derek Kalles: 02:15

Well, you’re going to get two different answers if you ask me or you ask my parents. So yeah, as a as a as a young kid, I was always looking on, looking for different ways to, to build something, you know, whether it was a spaceship, whether it was definitely the lemonade stand, the mowing lawns, helping turn around houses that were rentals or, you know, I went to a, I went to a conference with my dad who had was in the real estate space. And somehow I got inspired that they needed more storage businesses that were easier for kids to store things as we collected stuff and our parents would constantly try to throw things away. So I was, you know, determined to build a storage business, and that continued into college and obviously was embedded into my soul. And a part of my career here is always looking for different ways to build businesses.

John Corcoran: 03:10

How much were you shaped by growing up in a business where your dad had a property management business a lot?

Derek Kalles: 03:18

And what’s interesting is, you know, you know, my mom, my mom was a physical therapist assistant and helped mentally and physically handicapped kids in the public school. My dad sold real estate for many years. And actually, as I was about to head to university, he decided to turn this side business of managing all of his customers’ properties into his primary focus in the property management space. And, you know, and he did that at the time, as I’m the first generation to go to college, you know, he was trying to support and help myself and then my sister was able to launch and go on to university. And I didn’t understand that at that moment.

But it’s you know, both my parents have a wonderful work ethic and a desire to serve and a desire to build, and that has absolutely shaped me in my adult years.

John Corcoran: 04:13

And you also started a salsa business. Now talking about salsa and dancing. But salsa, the condiment that you put on tortilla chips.

Derek Kalles: 04:22

Yes.

John Corcoran: 04:22

Yeah. Because when I look at you, I think of the salsa business naturally.

Derek Kalles: 04:25

Yeah. Of course. You know, me, me salsa dancing would be a scary a scary sight to see. But in terms of salsa, the the edible food when I was at at school was in an entrepreneurship class entrepreneurship class. And we had to launch a business and we took this, this family recipe and turned it into a salsa.

And we called it, you know, we brought tomato and pepper together and called it Tom pepper salsa. And we ended up actually getting it into a dozen stores in the Seattle area. Wow. And it was one of those experiences where we learned the heights of success. And then we had some dysfunction as a team. 

 How often does that happen in business and partnerships and learning, learning the different needs of different people. And unfortunately, the business didn’t persist, even though it really should have. And it’s been fun as adults, I’ve stayed connected with most of the people that were a part of that class and in that team. And we all kind of even actually in the last year or so, reflected back what would have happened if we had kept Tom Pepper salsa going. And we all laugh. 

 Well, if you hadn’t been, you know, an idiot 20 year olds, we probably would have been able to do it. So yeah, but, you know, we had to pitch for funds and we got some seed capital between the University of Washington and a couple local banks. And, you know, that was our first experience in a maybe a more classic or formal business having to establish, you know, incorporations, marketing, sales, going out and meeting with, you know, the heads of grocery stores having to learn production having outsourced production safety. There were just so many dimensions. I didn’t fully appreciate at that moment that that helped me fast forward when it was time to, you know, launch my next business. 

 How that helped shape me.

John Corcoran: 06:11

Right, right. Yeah. For sure. So let’s talk about Kalles Group. So Kalles Group does cyber security.

And you launched that in the 2011 -2012 time frame after previously working at Accenture. Tell me about the vision behind it. Why did you decide, you know, someone you got a successful job at Accenture and all that kind of stuff. Why do you go out and start your own thing?

Derek Kalles: 06:37

So there, the origin, the origin story has a little bit of a hop from Accenture to that. So I had a wonderful experience working at Accenture, and then just realized it was time for me to move on. And actually, before I got to Kalles Group, I partnered with my dad back into that property management business. So he had kind of scaled it up to a point where. But it was him, an assistant and a filing cabinet.

And, you know, I still remember sitting across the table from him and going, wait, wait, wait, I sent you to college to go do all these things. And now you want to come back and work with me in this business or what are you talking about?

John Corcoran: 07:16

So it was your idea. So you’d work at Accenture and then take me. Take me back to it. So like you’d worked at a center and then you go back to him and you say, I want to work with you. Even though it was a pretty small business at that point.

Derek Kalles: 07:27

Yeah. You know, there was just a moment where I just loved the people I was working with. I was doing interesting work. I was in a great organization. And it just, there was still something missing.

And it was kind of that moment where it wasn’t them, it was me. And I was kind of ready to go build things myself and like, you know, and I didn’t have any other ideas and I wanted to do something. And I’ve always been around real estate at that point, I’d already bought real estate and like, you know, kind of turned around a few houses as a kind of a side thing while I was at Accenture. And so I came to my dad and said, you know, could we, could we partner into this business? And, you know, let’s go out and buy some other companies, bring in some technology, build a hub and spoke model and kind of scale up the business. 

 And, and.

John Corcoran: 08:17

What did he say when you came to him and suggested that?

Derek Kalles: 08:21

I think he told me no about five times. And then the fatherly instinct kicked in and said, I’m never going to be able to get my son to leave me alone until I say yes. And so, you know, and you know, through that journey, lots of highs and lows still have a great relationship with my father. I have that experience of, you know, doing a family business. And, and through that experience, the business got to a point where I was missing something.

And it was the technology side. And I was seeing many of the security implementation Implications in that business, because we were kind of ahead of some of those elements, both internally facing, but also the type of customers and investors we were seeing, the privacy challenges we were seeing the the cyber dimension start to tart, to tart to set in more. And that’s where.

John Corcoran: 09:14

This 2008, 2009, 2010 time frame.

Derek Kalles: 09:18

When we watched that bottom like so, I mean, we ran, we managed and grew, you know, the property management company through those really, really tough times. And, and kind of when there was a, a, a little parting of the clouds, it was just a moment for me in my career to stay, stay involved in that business. So I didn’t, you know, I moved to a board position versus an operating role position and kind of worked out so that I could go and, you know, launch, you know, launch Kalus group. And, and, and.

John Corcoran: 09:47

How did you manage to move yourself out of that without one it collapsing and two, without, you know, it getting pushed all back onto your dad or it, you know, reverting back to the way it was before. Did you put someone in place?

Derek Kalles: 10:02

Yeah. I mean, it was hard , you know, there were some mistakes made. It was not a perfect journey. You know, and there was me, my father and another partner. He was looking to exit as well.

So we kind of excited him and kind of structured a deal so that we could have a general manager in the business and partner with, you know, with my dad. And then, you know, there was a two year period as I was starting Kali’s group that I was still keeping a pretty active hand in the property management business to do some succession work to kind of set that business into its lane much. That’s a rabbit hole that can go very deep, you know, and there were some things that were done well. There were some places where, you know, you know, recognizing what it means to be starting a company and trying to, you know.

John Corcoran: 10:49

Manage the old, I was going to say like, that’s hard, right? Starting a new company in a new industry, plus like your foot still on the old one. That’s difficult.

Derek Kalles: 10:58

And not and not to sound like, you know, the old guy. I don’t think I could have done it if I had had kids. Like this was, you know, still pre kids. And, you know, I was working a ton to make that all work. And you asked about the vision of Kahless group.

It really was that thesis of, you know, great consultancies are, you know, good problem solvers, easy to work with. And they are, you know, flexible and malleable to meet whatever the gap is for these, you know, for organizations. I’m like, that’s the root of what consulting and professional services is. And, and I, and I wanted to bring that security lens to it. It started at our very, I love telling the story. 

 Our very first project.

John Corcoran: 11:40

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